Ukraine Conflict Impacting Logistics

The conflict in Ukraine is already starting to impact logistics across all transport modes, with the potential for more disruption to come.

The most obvious being the impact rising fuel prices are having on costs. Following the UK and US oil ban on Russia and escalating sanctions, many experts are predicting that oil may rise to a record high of $200 a barrel by the end of this month. This would be double the cost of the beginning of this year.

UK & European Road Transport

We are regularly receiving updates on fuel surcharges and/or increased costs, due to the hike in fuel costs. The situation remains very fluid and pricing could potentially change weekly while hostilities continue.

Ocean Freight

Bunker rates have increased by one-third already this month, which will impact ocean freight costs – especially on longer routes such as Asia/Europe round trips. Lower demand from Asia had seemingly pointed towards an upcoming reduction in rates, which may be curtailed by the soaring fuel costs.

Air Freight

Fuel is also impacting air freight prices, which are generally on the rise since the conflict started. No fly zones over Ukraine, Belarus, and parts of Russia are also impacting some flights to and from the Far East.

Rail Freight

Rail freight services, to and from China, generally travel through Russia and either Ukraine or Belarus. While some services are operational, many shippers and importers are avoiding this mode of transport for fear that shipments may be snagged due to sanctions.

Needless to say, all services to and from Ukraine, Russia and Belarus have been impacted by the conflict or the sanctions.

The Simarco team continue to monitor the situation closely. In the meantime, should you require further information, then please do not hesitate to contact us via sales@simarco.com.